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The IRS will be able to send money electronically to taxpayers who have filed direct deposit statements or bank account information. The government will send paper checks or debit cards to families for which the Treasury is unable to establish a bank account.
The IRS will use information about 2020 tax returns to determine eligibility and verify the amount. The agency will use the 2019 registry for families who have not yet declared their taxes this year – including people who used the “non-filing portal” for previous rounds of payments.
The legislation offers full payments of $ 1,400 for those with an adjusted gross income of up to $ 75,000 for individuals, $ 112,500 for heads of households and $ 150,000 for couples who file a joint tax return.
Payments are reduced for those with income above these limits. Payments will be limited to individuals with an income of $ 80,000, heads of household with $ 120,000 and married couples with $ 160,000.
For those who lost their jobs, the time to file a tax return was complicated by a newly offered tax cut on unemployment insurance.
The relief measure exempts taxes on up to $ 10,200 in unemployment benefits received by individuals last year. This provides an incentive to delay filing of tax returns for 2020. However, since a loss of revenue in 2020 can make someone eligible for a stimulus check, there may be a need to file a tax return quickly to reflect this income for the IRS.